DCIT vs. SUBEX TECHNOLOGIES LTD.,

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ITA 913/BANG/2013Status: DisposedITAT Bangalore01 October 2015AY 2009-103 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that credit for taxes paid in a foreign country can be granted even when tax liability is computed under Section 115JB. The Tribunal relied on a co-ordinate bench decision which held that there is no provision debarring such credit.

What were the facts?

The Revenue appealed against the relief granted to the assessee under Section 90 of the IT Act for computing tax liability under Section 115JB. The Revenue argued that foreign tax credit cannot be granted for Minimum Alternate Tax (MAT) provisions.

What were the issues?

Whether relief under Section 90 for foreign tax credit is admissible while computing tax liability under Section 115JB (MAT provisions).

Which sections of the Income-tax Act were involved?

Section 90,Section 115JB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCH ‘A’, BANGALORE

Before: SHRI N.V.VASUDEVAN & SHRI ABRAHAM P GEORGE

For Appellant: Shri Chytanya, K.K. Advocate
For Respondent: Shri T.N.Prakash, JCIT, Shri Chytanya, K.K. Advocate

PER SHRI ABRAHAM P GEORGE, AM:

1.

In this appeal filed by the revenue its grievances is against allowing of relief to assessee u/s 90 of the IT Act, while computing tax liability under the provisions of Sec.115JB of the IT Act, 1961.

2.

Learned DR submitted that taxes u/s 115JB of the Act, stood on a different footing than the regular tax computed under other provisions of the Act. Therefore, according to him, rebate for taxes paid in a foreign country could not be granted to the assessee.

3.

Per contra, learned AR supported the order of the CIT(A). He also relied on a decision of Co-ordinate Bench in the case of ACIT Vs L & T Ltd., in dated 22-04-2009.

4.

We have perused the orders and heard the rival contentions. The question is whether credit u/s 90 of the IT Act, would be given on tax liability under MAT provisions of the Act. We find that a very same issue had come up before the Mumbai Bench of the Tribunal in the case of ACIT Vs L & T Ltd., (Supra).

5.

Co-ordinate noted that the income on which tax has been paid abroad was included in ‘book profit’ for the purpose of Sec.115JA. It was held that once taxable income was determined either under the normal provisions of the Act or as per Sec.115JB, subsequent portion relating to computation of the tax has to be governed by the normal provision of the Act. It also held that there was no provision in the Act, debarring granting of credit for tax paid abroad in case income is computed u/s 115JA. It was further held that the assessee could not be denied the set off of tax relief against the tax liability determined u/s 115JA.

6.

CIT(A) had given relief to the assessee for the very same reasons mentioned by Co-ordinate Bench in the case of L &T Ltd (Supra). We do not find any good reason to interfere

7.

In the result, the appeal filed by the revenue is dismissed.

Order pronounced in the open Court on the 1st October, 2015.

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